Tuesday, 30 September 2014

The institutional system and decision-making capabilities of democratic centralism have proven to be the country's advantage

This year marks the 65th anniversary of the founding of the People's Republic of China, the 60th anniversary of the establishment of people's congress system and the 65th anniversary of the establishment of the Chinese People's Political Consultative Conference. In the past 65 years China has developed rapidly and has made great achievements. Democratic centralism is the core mechanism of the China model, the key to the China miracle, and China's advantage compared with other major developing countries.

China is still a developing country, and it lags behind the developed countries in many aspects. But it would be wrong to always attribute the developed countries' achievements to their democratic system. It's also wrong to deny China's success because of some partial setbacks or mistakes and to blame these on China's democratic system.

Democratic centralism is an institutional system as well as a decision-making model. Democratic centralism is an organization principle of the governing Communist Party of China, as well as national organizations, which links the CPC and the national mechanism based on the people's congress system.

Under democratic centralism, the decision-making process is first democratic discussion and then consensus on opinions on a democratic basis, which guarantees the decision-making process responds to public opinion to the greatest extent.

Currently there are two major political systems in the world: democratic centralism and representative democracy. If we want to make a comparison between the two systems, we should first make sure the premise of "comparability" holds. In other words, China should be compared with those developing countries that also have a long history, huge population and suffered a long time as a colony or semi-colony.

We can divide all the 12 countries with populations of more than 100 million into three groups. The first contains developed countries such as the United States and Japan, whose development is not due to representative democracy, but freedom of speech, rule of law, a market economy and exploitation of other countries.

The second group contains countries that have turned to representative democracy such as Russia. In the 1990s, the former Soviet Union fell apart and terrorism was widespread. The public called for Vladimir Putin's "controllable democracy", which has enabled Russia to revive.

The third group contains those developing countries that were colonized for a long time, such as Bangladesh, Brazil, China, India, Indonesia and Pakistan.

Representative democracy is the bottleneck for most of these countries' development and their people's welfare because of strong social forces and weak national power. The political organizations and family forces behind representative democracy make local social forces in these countries ever stronger, while national power is often too weak to turn national will into reality in this political system.

Some Western people compare India with China and expect India, the largest democracy according to the West's definition, to surpass China someday because they believe that representative democracy is the biggest advantage of India.

Yet in the Human Development Index, China has risen from the rank of 101 in 2001 to the rank of 91 in 2014, while India has dropped from 122 in 2001 to 135 in 2014. In the Poverty Population Index, 11.8 percent of China's population is below the international poverty line, while the percentage of India is 32.68. In the Corruption Perceptions Index, China ranks 80th while India ranks 96th. In the Ease of Business Index, China ranks 90th while India ranks 134th. In 2013, China's per capita GDP was $6,629, which is more than four times the $1,592 of India. The gap of per capita GDP between China and India is larger than two decades ago.

Why has the gap between China and India become larger? India is a democratic society but still has some feudal legacies, and the unfairness under feudalism can hardly accelerate market economy development. As to its "superior" political system, Indian-American political commentator Fareed Zakaria describes it as "bandit democracy". That means, a candidate who committed a crime yesterday may be elected today. India has about 2,000 parties. The country's high degree of fragmentation means it fails to propel public policies that benefit its citizens. The representative democracy of India is fragmented democracy that lacks authoritative policy execution.

Compared with the major developing countries that practice representative democracy, China's centralized democracy guarantees freedom, autonomy, a market economy and also authoritative governmental organizations. China has a lead in governance compared with other major developing countries mainly because of democratic centralism.

Democratic centralism has gone through the first stage during the revolutionary period, the second stage during the first three decades after the founding of New China, and the third stage during the three decades after reform and opening-up. From history and reality we can clearly see the advantages of this political system.

By Yang Guangbin (China Daily)/Asia News Network
The author is a professor of political studies with Renmin University of China.

Some 20,000 visitors made their way to the Malaysia Property Exhibition (Mapex) 2014 at the Subterranean Penang International Convention and Exhibition Centre (SPICE) in Relau, Penang, in search of their dream home.

From landed properties to high-rise units, the Mapex City 2014 showcased projects by reliable developers with prices which ranged from RM346,000 to RM15mil.

Event organising chairman Ng Chin-U said the three-day exhibition held from last Friday to Sunday saw developers generating RM48mil worth of sales.

It was the second Mapex this year. The first, which was held during Chinese New Year in February at the G Hotel Penang, saw about 30,000 visitors and a total sales of RM130mil recorded.

Ng said buyers might be adopting the wait-and-see approach as the Budget 2015 was just around the corner.

“The cooling-off measures on the property market may be one of the factors as well, as generally buyers are more careful,” he said.

Cooling-off measures include 70% loan policy for third property purchases, requiring the housing loan limits calculated based on net income instead of gross and loan tenure reduced from 45 years to 35 years.

Ng added that those who missed the exhibition this time around could look forward to next year’s Mapex, which is scheduled to be held during Chinese New Year in February.

Organised by the Real Estate and Housing Developers’ Association (Rehda) and Henry Butcher Malaysia (Penang), the exhibition was participated by a total of 16 exhibitors who took up 30 booths.

Penang Chief Minister Lim Guan Eng who opened the exhibition on Saturday, urged Bank Negara to reinstate the developers interest-bearing scheme (DIBS) for first-time buyers as well as increase and extend the scheme by Syarikat Jaminan Kredit Perumahan (SJKP) to buyers of affordable homes costing from RM72,500 up to RM400,000.

“Ever since DIBS was abolished, many first-time buyers of affordable housing could not obtain bank loans to buy their own homes.

“Up to 70% of the housing loan applications for low-cost and low medium-cost homes have been rejected by private banks,” he said.

He added that legal fees should be part of the DIBS package and stamp duty should be waived to lower the initial entry cost for first-time home buyers.

Friday, 26 September 2014

India's Mangalyaan probe entered orbit around Mars Wednesday morning, which has been hailed by the public throughout the country. People across India, from the authorities to media outlets, feel proud of the fact that India has become the fourth power to put a satellite into orbit around Mars after the US, Russia and Europe. The Indian public fully expressed their elation at having surpassed China in Mars exploration. China's first Mars exploratory probe, Yinghuo-1, went missing one year after its launch in 2011. There is rhetoric on India's Internet that the success of Mangalyaan is pouring salt into China's wounds, which, however, is too serious and strong a characterization.

Apparently, China will not feel jealous of Mangalyaan entering Mars orbit. Chinese people understand that they boast much more advanced technological, economic and social development than India does.

Actually, Chinese people have myriad reasons to feel delighted at the success of the Mangalyaan probe alongside Indian people. If a country that is relatively backward in scientific research is able to send a probe to Mars, it is highly possible that Yinghuo-2 may succeed in the future.

No country can claim to be a leader in every arena. India has proved this point in its competition with China.

When poor nations participate in the space race, they are often sneered at by others and criticized domestically as well.

India sees itself as a major power that is supposed to do something "irrelevant with people's interests" in the eyes of populists. A small country can be composed of schools, hospitals, restaurants and washrooms, while a big one must possess much more advanced technology such as satellites and nuclear-powered submarines, as well as constantly seek technological breakthroughs.

India's space exploration endeavor, against its prevailing social conditions, should be reflected upon by Chinese people. China's space program and the relevance to its social development level were subjected to intensive Western public scrutiny, but the West takes China's competitiveness in space seriously now. India reminds us of the importance of taking the first step.

Though Yinghuo-1 was outperformed by Mangalyaan, China's aerospace sector has made precious achievements in space, such as manned spaceflight and building space stations. Without these previous efforts, we will still be absent in some core fields.

Mangalyaan brings us more affirmation than a sense of competition. Among Net users from both countries, acrimonious remarks are heard against each other, creating an impression that China and India are mired in deep hostility.

But any real conflict of interest between the two is much less serious. Bilateral cooperation is entering the prime stage.

- UK, USA are moving up the index, but need to take urgent action to
attract greater funding to replace their aging infrastructure

- Emerging markets including Philippines and Indonesia are rising up the index

Singapore is the most attractive market in the world for
infrastructure investment, according to ARCADIS, the leading global
natural and built asset design and consultancy firm. Qatar and UAE
completed the top three with their strong business environments, healthy
pipelines of development work and growing economies, making them
attractive to investors, including pension funds and banks.

The findings come from the second ARCADIS Global Infrastructure Investment Index which
ranks 41 countries by their attractiveness to investors in
infrastructure. In order to gauge their appeal the study looked at
various issues including the ease of doing business in each market, tax
rates, GDP per capita, government policy, the quality of the existing
infrastructure and the availability of debt finance. Combining all of
these factors provided a strong overview of the risk profile for each
market and how attractive each one is likely to be to potential
investors.

Rob Mooren, Global Director of Infrastructure at ARCADIS said:
“Good infrastructure is important for the long term economic
development of a country. Many governments are struggling to finance
infrastructure investments. As traditional debt markets are now harder
to access, governments need to find alternative finance and agree to
progressing projects. By encouraging private finance into
infrastructure, governments can remain globally competitive and meet
their social and economic objectives.”

The GIII 2014 ranks the following as the top ten most attractive
countries for infrastructure investment in 2014. The difference from
their 2012 ranking is in brackets:

Singapore’s integrated strategic plan linking infrastructure planning
with business and social requirements helped it to retain its top
position in the index. However, the government self-finances most major
projects so investment opportunities are limited. Therefore other
countries with major investment plans such as Qatar and the UAE, and
emerging Asian markets such as Malaysia and the Philippines are
considered more promising for investors.

USA and UK enter top ten, but must deliver against pipeline promise

The USA and the UK entered the top 10 for the first time through
improvements in their economies as well as the growing need for
investment in infrastructure. However, both countries must work hard to
attract private investment funds, as they compete against countries
that provide more clarity on government infrastructure policy and are
able to act on their promises to delivery major projects.

Continental European countries struggling to attract finance

Continental European countries present a mixed picture in their
attractiveness to investors. At the top of the Continental European
table, low risk markets like Sweden and Norway remain stable at fifth
and sixth. Both have highly efficient business environments with
transparency in regulation and efficient legal systems. Continental
European countries such as Holland, France and Italy are either lacking
public finance needed to upgrade their ageing infrastructure or have a
lack of commitment from their governments to deliver proposed projects.
They have therefore slipped down the rankings.

Latin America countries vary in attractiveness

Chile is the highest placed Latin America country at 13th position, but
its potential is limited by its size. In 2013 its construction market
was estimated to be worth US$41.8billion but this is highly concentrated
in mining. Brazil is placed nearer the bottom of the ranking in 32nd
place, indicating that some of the difficulties experienced with delayed
programs have the potential to be risky for investors.

Rob Mooren continued: “A key difference that we have
seen in the Asian and Middle Eastern markets is that those countries
that have a clear integrated strategy tying infrastructure development
plans to business and economic objectives have higher rankings. This
gives long term clarity to investors and is something that developed
markets would do well to copy if they are to succeed in attracting more
private finance into infrastructure.”

The report also explored the factors that governments, infrastructure
owners and operators need to consider in order to attract private
finance. It suggested the structuring of infrastructure projects is key
to this. For example, in project finance, mature markets like Canada,
Australia, the US and the UK have sponsors that understand the pricing
of assets, are aware of the rates of return expected and appreciate the
key risks involved, making it easier to attract infrastructure
investment. These markets have experienced the early challenges of
introducing PPP and PFI and have learned what to expect from both an
investor and political perspective

Rob Mooren concluded: “Markets that have created the
right political environment committed to infrastructure development, can
demonstrate the economic conditions required to sustain long term
growth. They have attractively structured infrastructure schemes which
will stay ahead of the competition when it comes to attracting the pool
of international investors who are increasingly considering this asset
class.”
.

Malaysia has been ranked second in the Asian region in terms of being an attractive market for investment in infrastructure, according to Arcadis.

The leading global natural and built asset design and consultancy firm said Malaysia scores highly across the investment criteria, placing it ahead of other large regional economies like Japan, China and South Korea.

Globally, Malaysia is placed at the 7th position, ahead of the US, Australia and United Kingdom.

The findings come from the second Global Infrastructure Investment Index, where it looked at various factors including the ease of doing business in each market, tax rates, GDP per-capita, government policy, quality of existing infrastructure and the availability of debt finance.

Arcadis Head of Infrastructure for Asia Richard Warburton said that infrastructure is the backbone of a country and a catalyst for its long-term economic development.

With Malaysia's average annual population growth rate of 1.4%, he said, investment in new infrastructure will be imperative.

"Combined with Malaysia's goal of a high-income status by 2020, plans are already underway for specific cities and urban clusters under Greater Kuala Lumpur/Klang Valley to be developed into vibrant, productive and liveable cities that are comparable to other major cities in the world.

The top 10 most attractive countries in Asia Pacific for infrastructure investment this year are Singapore, Malaysia, Australia, Japan, China, Thailand, South Korea, Indonesia, India and Philippine.

Warburton said countries that have created the right political environment for sustained long-term economic growth and have attractively structured infrastructure schemes will stay ahead of the competition to attract international inventions.

Property
investments: good Infrastructure a way to huge profits and success. Buy
property with good connectivity, investors advised - The road to huge
profits. Packed room: Lee giving his talk on 'Infrastructure goes a long
way ...